Foreclosure Activity Increases

On our Apple Valley CA Real Estate Blog on March 30 we commented on “Falling Home Prices Boost Home Sales Across the Country”  (a report by Associated Press) The highlights of the report gave no substance to the so called Ghost Inventory, of foreclosed homes, that is hiding in the wings and in direct conflict with any notion that there is a signal that we are at the start of the end.

Realty Trac just released its U.S. Foreclosure Market Report for First Quarter 2009, which shows that foreclosure filings, default notices, auction sale notices and bank repossessions (all pre-REO activity) were reported on 803,489 properties in the first quarter, a 9% increase from the previous quarter and an increase of nearly 24% from the First Quarter 2008.

The number of households that received foreclosure filing, for the month of March, was more than 12% higher than the previous highest month on record.  Actual Foreclosure filings were reported on 341,180 properties in March, a 17% increase from February 2009 and a 46 percent increase from March 2008.  According to RealtyTrac The March and First Quarter 2009 totals were the highest monthly and quarterly totals since they began issuing report in January 2005.  All this increased activity was despite a drop in bank repossessions (REOs), which were down 13% from the fourth quarter of 2008 and 3% from February 2009.

The drop in recent REO activity can most likely be attributed to industry moratoriums, and government delays.  It’s reasonable to expect that the number of REOs will increase again, now that we are through with any delays.

A substantial amount of these foreclosures fall into three states, Nevada, Arizona and California

Nevada continued to document the nation’s highest state foreclosure rate in the first quarter, with one in every 27 housing units receiving a foreclosure filing — more than five times the national average. Foreclosure filings were reported on 41,296 Nevada properties during the quarter, an increase of 19 percent from the previous quarter and an increase of nearly 111 percent from Q1 2008. Bank repossessions in Nevada were down 3 percent from the previous quarter, but defaults increased 27 percent and auction sale notices increased 35 percent.

Arizona posted the nation’s second highest state foreclosure rate for the first quarter, with one in every 54 housing units receiving a foreclosure filing, and California posted the nation’s third highest state foreclosure rate, with one in every 58 housing units receiving a foreclosure filing.

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